Equality and Human Rights Commission set-up was ‘flawed and inefficient’ and cost the taxpayer £39m

The set-up of the Equality and Human Rights Commission (EHRC) was “flawed and inefficient” and cost the taxpayer £39m, a report by a committee of MPs has concluded.

The EHRC was created in October 2007 through the merger of the Commission for Racial Equality, the Disability Rights Commission and the Equal Opportunities Commission.

The damning report by the Public Account Committee said the watchdog had no control over which staff left the former commissions through an early exit scheme, costing £11m and leading to a large loss of staff with valuable skills. The re-engagement as consultants of seven senior staff who had taken early severance was carried out without competition or formal approval.

The committee said this meant the taxpayer was hit twice: some £630,000 for their severance packages and nearly £340,000 to rehire them. A further £15,000 payment to one of the re-engaged consultants was still “unexplained”, the report added.

Conservative MP Edward Leigh, PAC chairman, said: “This is not the way this committee expects public bodies to be run and reinforces the need in future for stronger controls and proper procedures for managing and using public money.”

EHRC chairman Trevor Phillips also came in for criticism. Leigh said Phillips “was in part responsible” for the ineffectiveness with which the board scrutinised the set-up process and challenged management’s proposals.

A separate report by the National Audit Office (NAO) also criticised the commission for poor planning during its formation,

In a statement, the EHRC said: “We have accepted these criticisms from the PAC and – as the NAO has recognised – we are taking steps to improve our financial and performance reporting, and strengthen our governance arrangements.”

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